Wives of Brits to lose UK pension

Thais married to British pensioners could be deprived of their pension income, under proposals to cut pension payments to foreigners.

  • Published: 7/05/2013 at 05:13 PM
  • Newspaper section: topstories

British pensions minister Steve Webb said too many foreign people who have “never set foot in Britain at all” are receiving UK pensions. To address this, a new Britsh law proposes to end to pension payments to foreign spouses. (Photo: Steve Webb)

Steve Webb, the British pensions minister, said too many foreign citizens who have “never set foot in Britain at all” are receiving UK pensions.

Under current law, the spouses of British men or women are entitled to claim a “married person’s allowance” based on their partner’s history of National Insurance contributions. 

But legislation to be announced on Wednesday will include proposals to end claims for such allowances and introduce a new flat-rate state pension, based on individual contributions paid to the UK government during a person’s working life. 

According to government statistics, married person’s pensions are paid to 220,000 people living outside the UK, half of whom are foreign citizens who have never been to Britain.

Mr Webb told the Daily Telegraph that the current situation, in which foreigners receive pension payments based solely on their spouse’s British work history, is “unacceptable”.

Spouses who qualify under the current rules can receive as much as £3,500 a year, or more than 160,000 baht.

“Most people would think, you pay National Insurance, you get a pension. But folk who have never been here but happen to be married to someone who has are getting pensions," he said.

“There are women who have never been to Britain claiming on their husband’s record. There are also men who have never been to Britain claiming on their wife’s record.”

According to a separate story in the Daily Telegraph, a British government source claimed that a rise in online match-making sites could be to blame for the increase in foreign claims for married person’s pensions.

Claims have been falling in Britain, because both partners in couples increasingly go out to work, but the number of allowances paid to the spouses of people living abroad has risen steadily.

“Technology facilitates relationships across the continents in a way that wasn’t the case 20 years ago,” the source said. There are “more people using the net and pairing up” and this is likely to be having some impact on the figures, the source added.

But Tom McPhail, head of pensions research at Hargreaves Lansdown, told the BBC that the proposals could cause an administrative “nightmare”, in terms of working out which current claimants should or should not continue receiving payments. 

Though all new claims for the allowances will be stopped eventually, interim arrangements are likely to mean that payments are stopped for foreign spouses who have never been to the UK, while retired British stay-at-home mothers, for example, continue to receive cash. 

“The government is going to face some interesting challenges in terms of administering this distinction they are seeking to make between UK recipients of this married person’s pension and people living abroad,” McPhail said. 

“Trying to disentangle these different categories of people and determine who is a deserving recipient to inherit the pension under these transitional rules and who isn’t, looks to me like a recipe for a very heavy, bureaucratic nightmare.”

Norman Cudmore, who served in the British Royal Airforce for 22 years and worked overseas for another 16 years, lives in the Philippines with his Filipina wife. He criticised the plans.

“I have contributed to the UK pension scheme for all those years and will qualify for a state pension. I did this so my wife would have some security when I finally pass away,” he said.

Defending the proposals, Mr Webb said the plans had nothing to do with penalising the spouses of different nationalities. “It's about whether they have put into the British system,” he said.

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